the situation is described a little out of context. If you have no insurance (but an expensive chronic pre-existing condition), you are either paying the bills yourself, or depending on the charity of doctors and hospitals treating you. "Charity" in this case means increased costs for everyone else. If this person had insurance before through a company plan, it would be the same price as every one else in the company pays (group plans are almost all guaranteed issue by law). I assume he does not, and no insurance company will take an individual with a pre-existing condition at any price.

The government cannot force insurance companies to take pre-existing conditions as guaranteed issue, nor take them on themselves, because everyone would simply wait until they got sick before buying insurance. The Obamacare (and Canadian) tradeoff is to make everyone buy insurance at the same rate regardless of pre-existing conditions, and not wait until they need it. In the USA it is termed a penalty, in Canada a tax, pretty much the same otherwise.

I have a pre-existing condition (RA) and individual insurance. By law, insurance companies are not allowed to raise your rates or cancel you because you become sick. However they have been able to do it just the same (by raising the rate on the group and moving those without chronic conditions to a lower priced group). As an example my insurance has gone from $230/m in 2003 to $2300/m now (and the deductible raised from $1000 to $10,000 in the same interval), projected to be over $4000/m within 3 years. I cannot change plans as no one will take me. Under Obamacare, better coverage is less than half that price, before subsidies, and similar to what insurance cost for a healthy individual prior to Obamacare (even from the company I am currently with).

To summarize, this guy currently has no insurance and has no idea what it costs. For him, $597 is one hell of a good deal and what everyone else in his area, at his age will pay. He may be currently paying his own bills, but at that income level with diabetes, actuarial predictions are that he will not be able to over time, and end up on the public dole. The only way to truly reduce US health care costs is to go to a single payer system, like Canada - and pretty much every other civilized country - already has. But that ain't going to happen any time soon here.